Saba doing well, Statia still lagging, says CFT

The Committee for Financial Supervision CFT Bonaire, St. Eustatius and Saba in its second semi-annual report in 2015 concluded once more with satisfaction that Saba’s public finances were in order. St. Eustatius is making slow progress on the improving of its finances and related reporting responsibilities.

According to the CFT, the quality of the financial management of the public entities varies considerably and leads to very different evaluations. Saba has consistently achieved a balanced budget in recent years, and continued to do so in 2015. The 2016 budget is balanced and has been cautiously drafted, in CFT’s opinion.

“The quality of the financial management of the public entities varies considerably and leads to very different evaluations,” says the Committee for Financial Supervision CFT Bonaire, St. Eustatius and Saba. From left: Hyden Gittens, Age Bakker and Sybilla Dekker. (Photo by Edgardo Lynch/CFT)

St. Eustatius on the other hand, didn’t fully comply with the reporting duties and the obligation to submit the annual accounts in 2015, as well as the budget process which was not concluded completely and in a timely fashion.

Bonaire has achieved a balanced budget in recent years. The 2014 annual accounts were timely adopted by the Island Council and they show a small surplus. The execution reports clearly show an improvement in quality of government’s financial management.

The CFT was most positive about Saba. “Impressive improvements” were made in the area of financial management, based on which the annual accounts 2014 was given an unqualified opinion. However, the CFT did advise to include more extensive explanations in the execution reports and to take measures to improve the liquidity and resilience.

St. Eustatius was placed under stricter administrative supervision in June 2015 by Minister of Home Affairs and Kingdom Relations Ronald Plasterk. The island government also received a financial instruction.

The CFT stated in its report that Statia’s Island Council only adopted the 2014 annual accounts on November 19, 2015, and that the year ended with a deficit of more than US $300,000. The first budget amendment in May 2015 showed a large deficit and subsequently received a negative qualification from the CFT. A revised budget amendment was only submitted in December.

CFT further noted that in the absence of the necessary reports, it has had insufficient insight into Statia’s financial situation. “The CFT has repeatedly requested attention for this matter,” it was stated in a press release issued on Thursday. An expert group has drawn up a plan with the purpose to improve Statia’s financial management, of which the CFT so far has not received any progress report.

After the adoption of the budget in 2016 by the St. Eustatius Island Council, in which the 2014 deficit was compensated, Minister Plasterk has somewhat slackened the instruction and decided to waive the commitment stop and to institute preliminary supervision.

Despite the optimism about Bonaire’s finances, the CFT did caution the island government to “nevertheless remain fully focused on further improving its financial management, the quality of its reports and the strengthening of its liquidity position.” The CFT has requested particular attention for the timely adoption of financial statements of government companies.

The CFT further observed that it takes a lot of effort for the public entities to fully incorporate structural maintenance charges in their 2016 budgets. The CFT has previously pointed this out to the governments and has indicated that it will give this matter special attention.